Rehab Loans 

This is the most often requested type of commercial hard money loan is for the purpose of improving commercial properties.  The funds are used to improve the commercial property, which may then be used to lease or resell for a profit.  Commercial hard money can work well in this situation because of quick turn time and extremely flexible lending criteria.

Rehab loans are generally closed at 65% or below of the current value, but exceptions are possible under certain circumstances. 

LOAN AMOUNT:  $500,000 and up.

BORROWER:  Owner/developer with track record.

LOAN TERM:  1 to 3 years, interest only.

PREPAYMENTS:  Loans may be prepaid at any time, after a possible lockout period, most with no prepayment penalties.

INTEREST RATE:  Rates start at 12%.  Interest is paid monthly on the amount drawn based on the disbursement schedule.

COLLATERAL:  First mortgage on land, existing structures, and future structures.

LTV RATIO:  Up to 75% of the as-is value and up to 100% of development costs.

USE OF LOAN:  Proceeds may be used for construction costs, real estate acquisition and related costs.

ITEMS NEEDED:  Completed loan application, title report, appraisal, project overview, proposed building plans, cost projection for disbursement schedule, exit and re-payment plan, proof of funds for purchase of land and occasionally some other financials.

FEES: Varies from project to project

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